Ivanhoe Electric Inc. has released its preliminary feasibility study for the Santa Cruz Copper Project in Arizona, revealing a high-quality underground mining operation with strong economics. The project boasts an after-tax net present value 8% of $1.9 billion and a 24.0% internal rate of return at the current Comex copper price, updated reserves, and a mine plan supporting 100% heap leach process producing 1.4 million tonnes of copper cathode over a 23-year mine life. The initial capital stands at $1.24 billion with first quartile unit cash costs of $1.32 per pound of copper.
The study indicates that the project's probable mineral reserves total 136 million tonnes at a grade of 1.08% copper, supporting a 23-year mine life. The modern underground mining operation is expected to utilize modern mining technology, with an average annual production of 72,000 tonnes of copper cathode during the first 15 years of mining.
The initial project capital is $1.24 billion with a capital intensity of approximately $17,000 per tonne of copper. At the current Comex copper price of $4.83 per pound, the after-tax net present value at an 8% discount rate is $1.9 billion with an internal rate of return of 24%. The study confirms the project's strong economics at prices well below today’s Comex copper price.
The project is located on nearly 6,000 acres of 100%-owned private land, with a planned site layout providing space for future expansion opportunities. The study also includes an initial mineral reserve estimate for the project, with probable reserves of 136 million tonnes at a 1.08% total copper grade, totaling 1.5 million tonnes of contained copper.
The project is expected to target initial construction in the first half of 2026, with the first copper cathode production projected in 2028. The company is pursuing multiple avenues of funding, including support from United States government agencies, commercial lending institutions, and potential strategic partners at the asset level.
The project is positioned to become one of the nation’s next major domestic producers of refined copper, with the potential to support future expansion on the existing land package.
The report emphasizes the urgent national security imperative for the United States to restore domestic American mineral production and highlights the strategic importance of having a secure, domestic supply of critical minerals, including copper.
The findings of the preliminary feasibility study indicate a significant milestone for Ivanhoe Electric Inc. and the Santa Cruz Copper Project, positioning it as a key player in the domestic copper production landscape. Following these announcements, the company's shares moved 3.31%, and are now trading at a price of $8.12. For the full picture, make sure to review Ivanhoe Electric's 8-K report.
